Query on Short Term Financial Planning

POSTED BY Venkatesh ON February 28, 2012 3:34 pm COMMENTS (12)


I have two queries as below:

1) I have some surplus NRI funds of Rs.8 lakhs, which I want to park for a short term, till I repay my loans in June / July’12. What is the best way to do this? I learn that NRE deposits come for 1+ year only. Would Liquid funds be ok for this? If so, what are the top funds in this category?

2) I wish to invest about Rs.12 lakhs in mutual funds, for a 2-4 years term. I have read in this blog that STP over a year’s time is the best way to go about this. How do I do this? I plan to put my money in top 3 equity diversified and 1 Gold ETF (Reliance). Is this fine? Do you have any suggestions?

Thanks in advance for your valuable guidance on this.

12 replies on this article “Query on Short Term Financial Planning”

  1. Sougatkar says:

    I am regularly investing in NPS Rs. 7000 p.m. And will invest for 20 more years. I am 39 years old now ,will invest upto 60 years. Value of investment will increase with pay commission. So can u please tell me how much lump sum will I get after 20 years of investing in New pension scheme. – Sougatkar

  2. Dear Jig, there are 4 cash management fund from HDFC. Which one you are referring to?

    Please clarify.



  3. Jig says:

    What is the difference between HDFC Cash management AND HDFC liquid Fund.

    Is it good to keep money in HDFC Liquid/HDFC Cash Management Fund rather than keeping in NRE saving account?

    What i understand – HDFC Liquid fund also not attracting any TAX for NRE account. Am i correct?


  4. Dear Venkatesh, apart from liquid funds, you may invest in short term debt funds also.



  5. BanyanFA says:

    Pleasure to be of help Venkatesh.


  6. Venkatesh says:

    BFA – thanks v. much for your reply.

  7. Venkatesh says:

    Dear Ashal,

    I think the following info may be useful for my Investor type: Married, 41 years, risk appetite: Above Average to High.

  8. Venkatesh says:

    Dear Ashal,

    Thanks for your reply. I wish to keep the funds as NRE only, as I need to repay a NRE home loan. Is there any Liquid fund to invest these as NRE funds for a short duration of 3-4 months?

    What is your recommendation for a 3-4 years timeline in the MFs? Can I include a Gold ETF also?

  9. BanyanFA says:

    I would suggest you to invest in Liquid Funds. Try investing into HDFC Cash Management Fund – Treasury Advantage Fund – Dividend Option.

    Why I have mentioned Dividend Option – it would be tax free for you in India. Any other option which you choose would attract 30% TDS. NRO deposits too would attract 30% TDS. Hence the option mentioned above is the best option. I have dealt with several NRIs in the past and they have loved this option.

  10. Dear Venkatesh, If not NRE, You may invest in NRO FDs for the time, you want to remain invested. In case of Debt fund, please opt dividend plan to gain from tax arbitrage available for such 3-4 months investment term.

    Eq. funds for 2-4 Y time, is a sure shot recipe to disaster as per my view. Invest in Eq. only if you do have 7-10 ore more years’ view.



Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.